UBS: Apple Is Having An 'Identity Crisis'

However, he does throw out one idea about the fuss around Apple right now: It's uncharted territory.

His note is titled "Identity Crisis: Can Apple Play Defense?"

Basically, Apple was always an aggressor, attacking new markets. Today it's in the unusual position of defending what it created.

This is a twist on what venture capitalist Marc Andreessen said not that long ago: The Steve Jobs' model was to invent a new category, take 100% market share, then watch the share decline until he killed the market with a new category. (Think iPod dying at the hands of the iPhone.)

Milunovich writes, "Apple historically has played the role of underdog, beginning with its niche Mac status after losing out to Windows." He adds, "The iPhone and iPad are the first times Apple has had a leadership position drawing significant and competent competition."

This is going to put pressure on Tim Cook to make decisions about what to do next.

"It doesn’t appear to be in Apple’s DNA to cover market spaces just to get revenue," says Milunovich, "Yet now that the company is so large due to iPhone success, investors are clamoring for product expansion with larger as well as lower-priced phones with Android gaining favor."

While Apple has a reputation for focus, it did fragment the iPod into different categories. Perhaps it will do the same thing with the iPhone and iPad, says Milunovich.

He concludes by telling investors to be patient: "The only way out might be innovation in new categories, which will require investor patience. Most companies would rush out a 5-6” phone; Apple probably won’t."